Pennsylvania’s leading small-business group, the National
Federation of Independent Business (NFIB) today warned that runaway spending
and proposed tax increases included in Gov. Tom Wolf’s 2015-16 state budget
will devastate Pennsylvania small businesses and working families. The $33.8
billion spending plan represents a 16-percent increase in spending over the
current fiscal year.
“For small businesses, this budget can be expressed using a
simple formula: high costs plus complexity equals cutbacks,” said Kevin
Shivers, executive state director of NFIB/PA.
“This plan papers over most of the problems in our state
budget and raises taxes on small businesses and individuals who’ve been forced
for decades to pay for Harrisburg’s mismanagement,” Shivers continued. “The
state incurs billions of dollars in new debt, including risky pension
obligation bonds, without tackling the actual causes of our state pension
crisis. The plan also raises taxes on
job creators to fund corporate-welfare programs that benefit only a select few.
“A 21-percent increase in the Personal Income Tax hits
small-business families right in their pocketbooks. Taxing professional
services like accounting, legal services and payroll services specifically hurt
small businesses that often are too small to have people in-house do those
functions.”
Shivers noted that 80-percent of businesses report their
earnings on individual returns of the owners.
“The natural gas extraction tax affects many small companies
that have flourished around the drilling sites – like water companies, trucking
companies, hotels and restaurants. Worse still, a portion of the tax on natural
gas extraction would be used to prop-up competitors in less successful energy
industries.
“Reducing the Corporate Net Income Tax and eliminating the
Capital Stock and Franchise Tax are positive moves. However, when you look at
the budget proposal as a whole, combined with the Governor’s call to raise the
minimum wage, small businesses are clearly the biggest losers,” Shivers added.
